Despite the tough year at an operating level, Wrightson's $434m sale of its seeds division to DLF Seeds provided a massive gain for the rural services firm's bottom line. It reported a record net profit of $131.8m, up from $18.9m a year earlier.
The company will complete a $234m capital return via a scheme of arrangement and 1-for-10 share consolidation tomorrow. Cornerstone shareholder Agria Corp will pocket $104m of the proceeds.
Wrightson's board went through a reshuffle earlier this year after Agria ceded a controlling stake and the Cushing family increased its influence on the country's biggest rural services provider.
A corporate structure review has been completed and is expected to trim $2.5m of expenditure in the upcoming financial year, although the board and management are still reassessing the company's strategy and examining ways to grow the business.
Finlay said the impact of M.bovis on the dairy and beef sectors and the uncertainty about the government's plans for agriculture continue to sap farmer confidence and is leading to more cautious investment intentions.
In saying that, he said the board and management still expect global demand for protein and increased confidence in the management of the M.bovis outbreak will flow through to better trading for Wrightson.
"We are also buoyed by the ongoing confidence in the horticulture sector and we anticipate that the Fruitfed business will continue to go from strength to strength as this sector grows," he said.
Wrightson expects to report operating ebtida of more than $30m in the June 2020 financial year as it cuts corporate costs to fit the smaller business. That also assumes a more normal trading year and continuing confidence in commodity prices. The company says it will be better placed to provide guidance at the annual meeting in October.
The board declared a final dividend of 7.5 cents per share to be paid on Oct. 2 to shareholders registered on Sept. 11. After accounting for the share consolidation, that effectively takes the annual return to 15 cents, or $11.3m. The 3 cents per share paid in the prior year amounted to $22.6m due to the greater number of shares on issue.
Wrightson shares will resume trading today after being halted for the share consolidation and have been quoted at $2.40.
Independent director Ronald Seah will retire from the board at the end of August, ending a seven-year spell with Wrightson. The board doesn't intend to replace him.